Businesses in East Lansing are dependent on student-driven economy

Photo of East Grand River with businesses and the everyday life of Grand River.

Businesses in East Lansing are supported by a student-driven economy in which many businesses cater to the needs of the student population. This can be seen not only in the types of businesses located near Michigan State’s campus but also their sheer quantity.

Andy K. Hahn

Photo: Andy K. Hahn

“Without the students this town wouldn’t exist,” said Jeff Cooper, a barber at Campus Barber Incorporated located on East Grand River Avenue. “The townies (East Lansing residents that are not students) need to get that the students are not part-time residents — that they’re full time residents. I mean if that campus over there wasn’t over there, there’s not a business on this strip that could survive.”

Not all of the businesses that are found in East Lansing are only there to cater to the students. Some are there to cater to East Lansing as a whole. As Tim Dempsey, the director of East Lansing’s Planning, Building, & Development Department said, some businesses cater to students, and then there are businesses that cater to both, such as restaurants.

When looking at East Lansing businesses and comparing them to other college towns, we are able to draw several similarities.

East Lansing as a college town does have things about it that does make it different from other college towns.

This is Professor Charles Ballard, a Professor of economics at Michigan State University. Photo: Andy K. Hahn

“Something that is unusual about East Lansing, there are a lot of college towns where everybody or almost everybody lives on campus. I’m not sure the exact number but I think it’s between something like 15,000 to 20,000 students who live on campus in the neighborhoods and that changes the character (of East Lansing),” said Ballard. “If we didn’t have as much on campus student housing then — if we had the same number of students — they would have to live somewhere and that would mean that we would have more apartments off campus.”

“Now as you may know, a lot of apartments have been built in recent months and years. I’m not sure who’s going to live in all of those,” Ballard said. “I think there is a possibility that we may look back on this period and say that it was a period of overcapacity in housing, but I guess that remains to be seen, because Chandler Crossings (apartment complex in nearby Bath Township) is still open for business, but I think as more and more of the apartment complexes get built it’s gonna put downward pressure on rent and it may get to the point where some apartment complexes decide that they have to go out of business. We’ll see.”

People make make the argument that, if Michigan State was to close down, that East Lansing’s economy would be able to survive the blow that it would strike. Although it may be possible to survive a blow like this, East Lansing would not be the same without Michigan State.

Estimates of the population of East Lansing, Estimates. Source: American Fact Finder United States Census. Graphic: Andy K. Hahn via Google Docs.

“If Michigan State were to close down it would be catastrophic for East Lansing. There wouldn’t be much of a city here, because if MSU were to close down it wouldn’t just be that 50,000 students would no longer be here, it would mean that I wouldn’t be here along with 12,000 other faculty and staff,” Ballard said. “Those people are essential to the lifeblood of this community, takeaway Michigan State University and East Lansing would barely exist.”

“If the university were suddenly to close — I’m not predicting that it will — but if it were suddenly to close, a whole lot of people who have a job right now wouldn’t have a job, myself included,” said Ballard. “A huge fraction of the people who live in East Lansing either are university employees or university students, or they make their living catering to those folks. They either own or manage the apartments where people live, or they own or manage or work in the restaurants or something like that.”

To that extent, what if Michigan State was never in East Lansing in the first place? Would the city have the same businesses?

“I don’t know that there wouldn’t be a downtown,” said Mark Meadows, mayor of East Lansing. “I think there would be potentially different kinds of businesses downtown. Businesses that are located there are catering to the foot traffic that they receive.”

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